Earlier this week, I responded to a post with a pretty long follow up wondering if the 0 percent tax rate is realistic or, frankly, a trick to scare everyone. In thinking about it for a bit, I decided it would make a good front page post.
First, no one, not even I, expects municipal, regional, state, or federal spending to not go up some amount each year. It would be nice if government didn't but it isn't realistic. Everything goes up. The key is whether or not it goes up 3 percent, 6 percent, or 17 percent.
Obviously, in an economic collapse, keeping as close to 0 percent is best. So many people in the private sector are getting hammered and having to live with less. If those of us in the private sector have to live with these conditions, so should the public sector.
I personally support government entities living within what the tax cap is proposing- whatever the CPI is for the previous year. This year, that would be 4.1 percent. In future years, it could be less or more. Granted, when it appears on the ballot in November, the tax cap will only cover the city of Concord side of the budget. But after it is approved, we’ll work on the others, in order to make Concord affordable again [or keep Concord affordable, if you will].
My fear, however, when city officials float 17 percent deficits and then state that they will propose a 0 percent budget, is that it will freak so many people out that they will be clamoring for more taxes to preserve services.
It's called "The old Kevin White trick" - release shocking and dire details about the budget proposing a godawful increase in an effort to get the rabble to accept a lower amount - which is the amount you really wanted them to accept in the first place.
As the fable goes, the Mayah of Boston in the 1970s proposed a 24 percent tax increase. Everyone freaked out about it for weeks and weeks. People were furious and it was the talk of the town. Then, after a bit of time, the Mayah held a news conference to calm everyone down, letting them know that taxes were only going up 12 percent. The public, breathing a sigh of relief, never realized until much later that the Mayah only wanted 12 percent in the first place. Those tricks led the state of Massachusetts to propose a statewide initiative known as Proposition 2 1/2, which essentially limits the levy and increase to 2.5 percent, plus new growth. Voters can also vote to increase taxes and pay for building bonds via initiative petition. I won't get into the specifics since it is a tad complicated. But it is not unlike the tax cap in place in some communities here in New Hampshire.
If our city officials are planning on doing this - floating a 0 percent budget instead of a realistic budget increase [like the tax cap proposal] - it is just flat out wrong. To trick the public only to end up taxing them 6, 7, or 8 percent more, and then saying "The public has spoken because we scared the sh*t out of them ..." is repulsively manipulative. This emotional response doesn't get to the heart of the matter: What is reasonable, affordable, and just, in the middle of a near depression. It also doesn’t address the issue of what the city should be doing and what it shouldn’t be doing. I truly hope that our city officials don't have this in the back of their heads but I won’t be surprised if this is the plan behind proposing a 0 percent budget.
In closing, I’ll say this: The key to government budgeting is to start from $0 each and every year and build up to what is available. If government did this, it would find that 1) It doesn’t need to do all the things it does, and 2) It would find more funds to do other things it should be doing or doing better.
First, no one, not even I, expects municipal, regional, state, or federal spending to not go up some amount each year. It would be nice if government didn't but it isn't realistic. Everything goes up. The key is whether or not it goes up 3 percent, 6 percent, or 17 percent.
Obviously, in an economic collapse, keeping as close to 0 percent is best. So many people in the private sector are getting hammered and having to live with less. If those of us in the private sector have to live with these conditions, so should the public sector.
I personally support government entities living within what the tax cap is proposing- whatever the CPI is for the previous year. This year, that would be 4.1 percent. In future years, it could be less or more. Granted, when it appears on the ballot in November, the tax cap will only cover the city of Concord side of the budget. But after it is approved, we’ll work on the others, in order to make Concord affordable again [or keep Concord affordable, if you will].
My fear, however, when city officials float 17 percent deficits and then state that they will propose a 0 percent budget, is that it will freak so many people out that they will be clamoring for more taxes to preserve services.
It's called "The old Kevin White trick" - release shocking and dire details about the budget proposing a godawful increase in an effort to get the rabble to accept a lower amount - which is the amount you really wanted them to accept in the first place.
As the fable goes, the Mayah of Boston in the 1970s proposed a 24 percent tax increase. Everyone freaked out about it for weeks and weeks. People were furious and it was the talk of the town. Then, after a bit of time, the Mayah held a news conference to calm everyone down, letting them know that taxes were only going up 12 percent. The public, breathing a sigh of relief, never realized until much later that the Mayah only wanted 12 percent in the first place. Those tricks led the state of Massachusetts to propose a statewide initiative known as Proposition 2 1/2, which essentially limits the levy and increase to 2.5 percent, plus new growth. Voters can also vote to increase taxes and pay for building bonds via initiative petition. I won't get into the specifics since it is a tad complicated. But it is not unlike the tax cap in place in some communities here in New Hampshire.
If our city officials are planning on doing this - floating a 0 percent budget instead of a realistic budget increase [like the tax cap proposal] - it is just flat out wrong. To trick the public only to end up taxing them 6, 7, or 8 percent more, and then saying "The public has spoken because we scared the sh*t out of them ..." is repulsively manipulative. This emotional response doesn't get to the heart of the matter: What is reasonable, affordable, and just, in the middle of a near depression. It also doesn’t address the issue of what the city should be doing and what it shouldn’t be doing. I truly hope that our city officials don't have this in the back of their heads but I won’t be surprised if this is the plan behind proposing a 0 percent budget.
In closing, I’ll say this: The key to government budgeting is to start from $0 each and every year and build up to what is available. If government did this, it would find that 1) It doesn’t need to do all the things it does, and 2) It would find more funds to do other things it should be doing or doing better.
1 comment:
Tony you have the cart before the horse. Tackle the school part of our taxes first, since they are the ones who need more scrutiny.
Post a Comment